An evil mix of greed, incompetence, nepotism, nationalism, youthful risk addiction and a kind of collective superiority complex led to the fall of the whole Icelandic financial sector in October 2008. This is among the conclusions that can be drawn from the 2300-page report submitted yesterday in nine volumes by the truth committee, which the Icelandic parliament commissioned to analyse what had caused the collapse of the Icelandic economy.

The report had been eagerly awaited and with great anxiety in the usually calm Icelandic society. It marks an end to a vicious blame game most players in Iceland's business and politics have been engaged in for the past 18 months, and hopefully a new beginning for a society ripped apart in internal conflict – in the aftermath of what generally is simply referred to as the Crash (Hrunið).

The report paints a picture of an uncontrollable and unsustainable financial system that had grown way above the capability of Icelandic state to back it up as a creatable lender of last resort. Newly privatised, each of the three main banks came into ownership of three nouveau-rich families in Iceland. The report graphically explains how the three business blocks then, in a kind of a testosterone-driven pissing contest, used the savings of generations of hard-working Icelanders to storm the global financial market, including the City of London.

The report also shows that the crash was mainly caused by a systemic error within Iceland. By vigorously enforcing its deregulation policy the lassez-faire government created a monster it couldn't control: the Icelandic Viking-capitalist was born. Any voice of caution and classical wisdom was dismissed as old-fashioned. In an opinion-oppressed political environment the regulation industry was made laughable by the politicians and business elite alike.

Then the Icelandic business Vikings headed for the high streets around Europe with their pockets full of borrowed money. Fresh out of business school Icelandic CEOs took over established companies in fields they couldn't even pronounce. The fast decision-making and risk-seeking behaviour of this new breed was hailed in the business media around the world, boosting the already overblown egos of these young alpha-males.

Within one short decade we turned a traditional Nordic welfare state economy into one of deregulated bonanza capitalism. We somehow lost sight of our roots and values, as is evident in the part of the report that deals with ethics. The president of Iceland, Ólafur Ragnar Grímsson – who recently vetoed the Icesave agreement – is portrayed as the main cheerleader of the new business elite.

When the clouds started to gather on the horizon in early 2006, all criticism against what we had grown accustomed to calling the Icelandic economic miracle, was dismissed as ill-intentioned whining by envious foreigners. Throwing nationalism into the mix of inexperience, the Icelandic government responded by launching a defensive PR campaign in London, New York and Copenhagen.

And then came the Crash. We now know it was inevitable. The truth committee's report has turned a mirror on us. Once so proud to be the home of the oldest parliament in the world, we now have to face the embarrassing fact that we allowed a handful of businessmen and corrupt politicians to turn our established democracy into some kind of idiot-cracy.